Six Sigma

Improving Quality Systematically

What IS Six Sigma? Why do organizations adopt it? And how does it help improve quality?

To answer these questions – and more – we're bringing you this guest article from Six Sigma expert, Thomas Pyzdek.

What Is Six Sigma?

Six Sigma is a rigorous, focused and highly effective implementation of proven quality principles and techniques. Incorporating elements from the work of many quality pioneers, Six Sigma aims for virtually error free business performance.

Sigma is a letter in the Greek alphabet used by statisticians to measure the variability in any process, and if you can keep the output of that process within a six sigma-wide band (in effect, no more than 3.4 defects per million outputs), you can be confident that your process is operating as it should.

Six Sigma focuses on improving quality (and therefore reducing waste) by helping organizations produce products and services better, faster and cheaper. In more traditional terms, Six Sigma focuses on defect prevention, cycle time reduction, and cost savings. Unlike mindless cost-cutting programs which reduce value as well as quality, Six Sigma identifies and eliminates costs which provide no value to customers.

Understanding the Tool

Six Sigma has two main strands. First, it involves using a handful of tried and true performance improvement methods and, second it involves training a small cadre of in-house technical leaders, known as Six Sigma Black Belts, to a high level of proficiency in the application of these techniques.

The DMAIC Framework

The tools are applied within a simple framework known as DMAIC, or Define-Measure-Analyze-Improve-Control. DMAIC can be described as follows:

D

Define the goals of the improvement activity. At the top level the goals will be the strategic objectives of the organization, such as a higher ROI or market share. At the operations level, a goal might be to increase the throughput of a production department. At the project level goals might be to reduce the defect level, and increase throughput. Apply data mining methods to identify potential improvement opportunities.

M

Measure the existing system. Establish valid and reliable metrics to help monitor progress towards the goal(s) defined at the previous step. Begin by determining the current baseline. Use exploratory and descriptive data analysis to help you understand the data.

A

Analyze the system to identify ways to eliminate the gap between the current performance of the system or process and the desired goal. Apply statistical tools to guide the analysis.

I

Improve the system. Be creative in finding new ways to do things better, cheaper, or faster. Use project management and other planning and management tools to implement the new approach. Use statistical methods to validate the improvement.

C

Control the new system. Institutionalize the improved system by modifying compensation and incentive systems, policies, procedures, MRP (Manufacturing Resource Planning), budgets, operating instructions and other management systems. You may wish to utilize systems such as ISO 9000 to assure that documentation is correct.

Although the approach is simple, it is by no means easy. However, the results justify the effort expended. Research has shown that firms that successfully implement Six Sigma perform better in virtually every business category, including return on sales, return on investment, employment growth, and share price increase.

Black Belts

Candidates for Black Belt status are technically-oriented individuals held in high regard by their peers. They should be actively involved in the process of organizational change and development. Candidates may come from a wide range of disciplines and need not be formally trained statisticians or engineers.

However, because they are expected to master a wide variety of technical tools in a relatively short period of time, Black Belt candidates will probably possess a background in college-level mathematics, the basic tool of quantitative analysis. Coursework in statistical methods should be considered a strong plus or even a prerequisite. As part of their training, Black Belts receive 160 hours of classroom instruction, plus one-on-one project coaching from Master Black Belts or consultants.

Successful candidates will be comfortable with computers. At a minimum, they should understand one or more operating systems, spreadsheets, database managers, presentation programs, and word processors. As part of their training they will be required to become proficient in the use of one or more advanced statistical analysis software packages.

Six Sigma Black Belts work to extract actionable knowledge from an organization's information warehouse. To assure access to the needed information, Six Sigma activities should be closely integrated with the information systems (IS) of the organization. Obviously, the skills and training of Six Sigma Black Belts must be enabled by an investment in software and hardware: It makes no sense to hamstring these experts by saving a few dollars on computers or software.

Other Elements of Six Sigma Infrastructure

Leadership

Six Sigma involves changing major business value streams that cut across organizational barriers. This effort cannot be lead by anyone other than the CEO, who is responsible for the performance of the organization as a whole. Six Sigma must be implemented from the top-down.

Champions and Sponsors

Six Sigma champions are high-level individuals who understand Six Sigma and are committed to its success. Sponsors are owners of processes and systems who help initiate and coordinate Six Sigma improvement activities in their areas of responsibilities.

Master Black Belts

This is the highest level of technical and organizational proficiency. Master Black Belts provide technical leadership of the Six Sigma program. Thus, they must know everything the Black Belts know, as well as understand the mathematical theory on which the statistical methods are based. Master Black Belts must be able to assist Black Belts in applying the methods correctly in unusual situations.

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Whenever possible, statistical training should be conducted only by Master Black Belts: otherwise the familiar "propagation of error" phenomenon will occur. Because of the nature of the Master's duties, communications and teaching skills are as important as technical competence.

Green Belts

Green Belts are Six Sigma project leaders capable of forming and facilitating Six Sigma teams and managing Six Sigma projects from concept to completion. Green Belt training consists of five days of classroom training and is conducted in conjunction with Six Sigma projects. Training covers project management, quality management tools, quality control tools, problem solving, and descriptive data analysis.

How Six Sigma Helped Save Motorola

Motorola, the originator of Six Sigma, developed the approach simply to survive. Back in the 1970s, the company was being consistently beaten in the competitive marketplace by foreign firms that were able to produce higher quality products at a lower cost.

When a Japanese firm took over a Motorola factory that manufactured Quasar television sets in the United States in the 1970s, they promptly set about making drastic changes in the way the factory operated. Under Japanese management, the factory was soon producing TV sets with 1/20th of the number of defects they had produced previously. They did this using the same workforce, technology, and designs, making it clear that the problem was Motorola's management. Eventually, even Motorola's own executives had to admit "our quality stinks”.

Motorola's CEO at the time, Bob Galvin, started the company on the quality path known as Six Sigma and became a business icon largely as a result of what he accomplished in quality at Motorola. Today, Motorola is known worldwide as a quality and profit leader. After Motorola won the Malcolm Baldrige National Quality Award in 1988, the secret of their success became public knowledge and the Six Sigma revolution was on.